The “unfunded liabilities” of state and local pension funds are California’s biggest unresolved political issue – at least in financial terms.

We know, with fair accuracy, how much money flows into and out of those trust funds now and into the reasonably predictable future, as well as the current value of their investment portfolios.

What we don’t know is what those investments in stocks, bonds, real estate and hedge funds will earn in the future. And while there’s no way to precisely predict those earnings, the assumption of how investments will fare determines the size of the pension debt.

For many years, the California Public Employees’ Retirement System and other state and local pension systems have assumed earnings, technically called the “discount rate,” in the 7.5 percent to 8 percent range, and they seemed to be generally on target.

With that assumption, California’s unfunded pension liabilities – the gap between what the funds expect to have and what retirees will be owed – are roughly $450 billion.

That’s a big number, but investment earnings have stumbled in the last couple of years. CalPERS gained 2.4 percent in 2014-15 and a minuscule 0.6 percent in 2015-16. That generally was the experience of other California and national systems as well.

A couple of years ago, the Governmental Accounting Standards Board began pressuring governments to report their pension debts more fully – and perhaps more realistically.

However, they’ve been reluctant to make big discount rate changes for the simple reason that dramatic decreases would ramp up pressure to either put more tax dollars into the systems to cover the debt, or modify workers’ pension benefits to reduce the fiscal impact.